Spotify stock rises as Bernstein reiterates Outperform rating

Investing.com - Spotify (NYSE:SPOT) stock gained after Bernstein SocGen Group reiterated its Outperform rating and $830.00 price target on the music streaming service. The stock has delivered impressive returns of 44.25% year-to-date and 35.15% over the past year, according to InvestingPro data, which also reveals that 9 analysts have recently revised their earnings expectations upward.

The firm’s positive outlook comes as Spotify launched its Premium Platinum tier in five key Asia-Pacific markets - India, UAE, Indonesia, Saudi Arabia, and South Africa. These markets represent a low-single-digit percentage of Spotify’s third-quarter subscribers.

The new high-end subscription costs more than twice the standard rate and offers subscribers access to premium features including HiFi/lossless audio and AI DJ. Bernstein views this launch as the beginning of what it calls the "superfan era" for the streaming platform.

Alongside the Platinum launch, Spotify has increased pricing on its Standard tier by over 40% in these markets while introducing a Lite tier, potentially to retain price-sensitive users.

Bernstein noted that tiering in additional regions introduces an incremental pricing lever for Spotify into 2026, which could potentially roll out alongside the lossless audio cycle in developed markets and the audiobook cycle in Latin America, Spain, the Nordics, and Japan. With a PEG ratio of 0.86 and an overall financial health score rated as "GREAT" by InvestingPro, Spotify appears well-positioned to capitalize on these growth opportunities. Discover comprehensive analysis in Spotify’s Pro Research Report, available with 14+ additional ProTips.

In other recent news, Spotify has reported its third-quarter results, which have prompted several analysts to adjust their price targets for the company. Cantor Fitzgerald raised its price target to $675, highlighting that Spotify’s revenue outperformed expectations by 1%, and operating income exceeded projections by 16%. Benchmark also increased its price target to $860, citing strong average revenue per user in the premium segment despite a slight miss in fourth-quarter revenue guidance. However, Rosenblatt lowered its price target to $670, noting delays in ad growth, though they acknowledged positive variances in ad-based users and gross margins. Guggenheim adjusted its price target to $800, citing pricing uncertainty, while maintaining a Buy rating despite the company’s guidance for premium subscriber additions falling short of their expectations. Additionally, Spotify’s Chief Financial Officer, Christian Luiga, will present at the 2025 Morgan Stanley European Technology, Media & Telecom Conference, with a webcast available on the company’s Investor Relations website. These developments reflect ongoing evaluations of Spotify’s financial performance and strategic direction.

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